As the South Korean stock market took a direct hit from increasing uncertainties, including a trade war between the United States and China, the nation’s top four business groups – Samsung, SK, LG and Hyundai Motor – have lost nearly 70 trillion won (US$62.25 billion) in market capitalization. In particular, the nation’s stock market behemoth Samsung Electronics Co. saw its share prices plunge after a stock split due to concerns over poor performance, suffering a loss of more than 40 trillion won (US$35.57 billion) in market capitalization.
According to the Korea Exchange (KRX) on August 19, the total market capitalization of 57 listed subsidiaries under the top four business groups came to 732.4 trillion won (US$651.31 billion) as of the 17th, down 68.9 trillion won (US$61.27 billion) from 801.3 trillion won (US$712.58 billion) at the end of last year.
By group, Samsung Group showed the largest drop in market capitalization. The recent market capitalization of 16 subsidiaries under Samsung Group such as Samsung Electronics, Samsung BioLogics Co. and Samsung C&T Corp., except for preferred stocks, amounted to 434.1 trillion won (US$386.04 billion), down 41 trillion won (US$36.46 billion) from 475.1 trillion won (US$422.5 billion) at the end of last year. This is because the market capitalization of Samsung Electronics, which ranked first in terms of market capitalization, decreased nearly 46 trillion won (US$40.91 billion) compared to the end of last year as its shares continued to go down owing to concerns over the memory chip market conditions. The price of Samsung Electronics shares fell to 43,700 won (US$38.86) during mid-day trading on the 16th, reaching a 16-month record low after 41,960 won (US$37.31) on April 27 last year.
The market capitalization of SK Group, which props up the South Korean stock market along with Samsung Electronics, also dramatically decreased from 126.9 trillion won (US$112.85 billion) to 122.2 trillion won (US$108.67 billion). For LG Group, the market capitalization of LG Electronics Co. dropped 5.4 trillion won (US$4.8 billion). The total market capitalization of the group also fell 14.1 trillion won (US$12.54 billion) as 11 out of its 12 listed subsidiaries, including LG Corp., LG Chem Ltd. and LG Display Co., saw their market capitalization drop. In addition, the market capitalization of Hyundai Motor Group decreased about 9 trillion won (US$8 billion) as that of Hyundai Motor Co. alone dropped 7.3 trillion won (US$6.49 billion) because of the cancellation of its governance structure reform plans and poor performance in the global market.